Shouldice Hospital Discussion

Shouldice hospital should start to entertain the idea of expanding off-site. While they have a great practice in Canada, there are quite a few reasons to consider expanding to the U.S. According to our case, there were approximately 600,000 hernia operations performed in the US, which indicates a favorable market for expansion. Also, many of these hernia patients chose to have their operation at Shouldice hospital, with about 42% traveling from the U.S. for this procedure.

Shouldice’s success is also being emulated by other establishments as shown by the advertising for a clinic in Florida. Many of these other establishments do not perform the same operation nor do they provide the same level of care and customer service. By associating themselves with Shouldice, these hospitals could potentially tarnish the Shouldice name. It appears that many that are trying to imitate Shouldice may be located within the U.S., and expanding here could be the way to start preventing this.  

Shouldice Hospital currently has a structure that is very conducive to expansion or contraction. The staffing organization has a relatively minimal cost for supporting labor and expenses. Majority of the expenses are incurred from the surgeons and nurses. Additionally, wages paid to surgeons and nurses will be most likely higher than in Canada, but the hospital fees will also be relatively higher.   Table 1 indicates a possible P&L for an off-site hospital location established in the US. All the supporting jobs, housekeeping, maintenance, administration, and other expenses have be raised by 20% to accommodate for the cost of living increases. However, the amount of personnel will remain the same, due to the operation requirements of the hospital. An offsite location with 50 beds, 6 surgeons and 20 nurses will perform generally 100 operations a week will little issue. If you reduce the examination rooms to three, admittance and testing to one station, and run three operating rooms with the same timeline, you get a hospital capable of $ 2.8 million. This is not including the initial startup cost. This is a strong possibility and an excellent way to expand the methodology. Also, in moving to the US, they can consider diversifying into other areas to help combat the steady competition they are already facing within this marketplace.

In terms of patient care and overall service, Shouldice is doing a great job of being attentive and actively aiding to their patients recovery. The entire process is well designed and allows for both physical and psychological recovery in a fairly short period of time. Even before the operation was to begin, having patients arrive beforehand for pre-examinations, orientation, and group dinners is a way to ease tension and overall provide a relaxing experience.

Surgery itself was fairly quick ranging from about 45 minutes for routine surgeries, to at most 90 minutes for more complex procedures. After the surgery, patients are encouraged to walk with the help of a surgeon, to the post operating room, and are further encouraged to keep moving throughout the day. This is important as not only does it promote an extra level of care for its patients, but also quickens the recovery time. In comparison with other hospitals performing the same procedure, patients with jobs that required light exercise normally returned to work within 2 weeks, while Shouldice patients could return within the week. For patients with jobs involving more strenuous work, it would usually take 8 weeks before they could return to work, while Shouldice patients only required 4 weeks. Quick recovery times and attentive service were also aided by state of the art facilities with not only extensive operating and recovery rooms, but also the availability of sunrooms, pool tables, and exercise equipment.